American International Group (AIG) | Ensure that Underwriting Practices Do Not Support New Fossil Fuel Supplies

Status
Withdrawn
AGM date
Resolution details
Company ticker
AIG
Lead filer
Presbyterian Church
Resolution ask
Adopt or amend a policy
ESG theme
  • Environment
ESG sub-theme
  • Fossil fuel financing
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Financials
Company HQ country
United States
Resolved clause
Shareholders request that the AIG’s Board of Directors adopt and disclose new policies to help ensure that its underwriting practices do not support new fossil fuel supplies, in alignment with the IEA’s Net Zero Emissions by 2050 Scenario.
Whereas clause
The Intergovernmental Panel on Climate Change (IPCC) reported that global greenhouse gas (GHG) emissions must reach net zero by 2050 to limit global warming to 1.5°C.1 However, _the United Nations Environment Programme finds the world is on track to produce more than double the amount of_ fossil fuels by 2030 than can be burned and stay within 1.5°C of warming.2 The International Energy Agency’s (IEA) report, Net Zero by 2050, provides a comprehensive pathway for the energy sector to transition to net zero emissions by 2050. The report says, Beyond projects already committed as of 2021, there are no new oil and gas fields approved for development in our pathway, and no new coal mines or mine extensions are required.3 Property and casualty insurers have a unique relationship to climate risks. They both underwrite policies for and invest in the fossil fuel industry, which is responsible for about 90% of annual carbon dioxide emissions,4 while also writing policies meant to protect their customers’ homes and businesses from the impacts of climate-driven catastrophes. The worsening climate crisis has provoked more frequent and severe catastrophes, harming insurers who then impose further costs onto already climate-impacted customers.5 If the IEA’s recommendations are not met, this trend will only worsen. AIG has made no public commitments to limit fossil fuel underwriting. The Company is choosing to sustain the fossil fuel industry, while trying to predict and manage losses exacerbated by climate change. AIG lags behind European peers, including AXA, Allianz, Aviva, Generali, SCOR, and Zurich, that have committed to transitioning their underwriting portfolios to net-zero GHG emissions by 2050.6 To develop a credible net zero commitment the United Nations Environmental Program Finance Initiative recommends that financial institutions, including insurers, align with the IPCC’s 1.5°C no / low overshoot pathways as soon as possible, and that investment in new fossil fuel development is not aligned with 1.5°C.7 If fossil fuel expansion is not immediately stopped, it will expose insurers like AIG to material financial risk, including: • Operational risk from an increased likelihood of insured catastrophe losses, as well as increasing the risk of loss in AIG’s asset holdings. • Regulatory risk from increased compliance costs for insurers that fail to address the risks from underwriting fossil fuels. • Reputational risk if consumers view AIG’s sustainability commitments as untrustworthy given its unrestricted fossil fuel underwriting
Supporting statement
The board and management, in its discretion, should define the scope, time frames and parameters of the policy, including defining new fossil fuel supplies, with an eye toward the well accepted definition that new fossil fuel supplies include exploration for and / or development of oil, gas, and coal resources or reserves beyond those fields or mines already in production.

How other organisations have declared their voting intentions

Organisation name Declared voting intentions Rationale
Presbyterian Church U.S.A. Foundation For

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